KANSAS ADMINISTRATIVE REGULATIONS ARTICLE 19 CLASS A CLUBS

Transcription

1 KANSAS ADMINISTRATIVE REGULATIONS ARTICLE 19 CLASS A CLUBS Division of Alcoholic Beverage Control Kansas Department of Revenue Docking State Office Building 915 SW Harrison Street Topeka, Kansas Phone: / Fax: Website: KDOR_abc. @ks.gov

2 Subject Table of Contents through through Definitions Applications and renewals; documents required Requirements for class A club license Issuance of license Licenses, loss or destruction of; application for and issuance of duplicate Change of club status Refund upon voluntary cancellation Guests of members; reciprocal members, registration Roster of stockholders, partners, beneficiaries or associates Agreement for reciprocal membership Employees; registration of same; prohibitions Purchase of alcoholic liquor and cmb; requirements and restrictions Licensee s responsibility for conduct of business and employees Storage of liquor; removal from club premises Nontaxed liquor and refilling of containers prohibited Cereal malt beverages; sale allowed Minimum prices for drinks; how determined Clubs charge the same price for the same drink all day; day defined Licensee must pay city or county license tax before making sales Federal retail stamp Excise tax shall be current Suspension and revocation; grounds for; procedure Public functions on licensed premises; when allowed; approval of director Display of license Denial, revocation, or suspension of license upon request for hearing Extension of premises Class A clubs; automated devices Page Rev Kansas Administrative Regulations Article 19 Class A Clubs Page 2

3 (Authorized by K.S.A Supp ; effective Jan. 1, 1966; amended, E-77-15, March 19, 1976; amended Feb. 15, 1977; revoked, E-80-28, Dec. 12, 1979; revoked May 1, a. (Authorized by K.S.A Supp ; effective Jan. 1, 1969; amended Jan. 1, 1970; amended, E-77-15, March 19, 1976; amended May 1, 1977; revoked, E-81-36, Dec. 10, 1980; revoked May 1, 1981.) b. (Authorized by K.S.A Supp ; effective Jan. 1, 1974; amended, E-77-15, March 19, 1976; amended Feb. 15, 1977; revoked, E-81-36, Dec. 10, 1980; revoked May 1, (Authorized by K.S.A Supp ; effective Jan. 1, 1966; amended, E-77-15, March 19, 1976; amended Feb. 15, 1977; revoked, E-80-28, Dec. 12, 1979; revoked May 1, 1980.) (Authorized by K.S.A Supp ; effective Jan. 1, 1966; revoked, E-80-28, Dec. 12, 1979; revoked May 1, 1980.) (Authorized by K.S.A Supp ; effective Jan. 1, 1966; amended, E-77-15, March 19, 1976; amended Feb. 15, 1977; revoked, E-80-28, Dec. 12, 1979; revoked May 1, 1980.) a. Liquor pool; storage. All alcoholic liquor attributable to the member's liquor pool shall be stored and maintained in the licensed premises of the club in a safe manner. No such alcoholic liquor shall be stored at a place other than in the area designated as being licensed except upon written approval of the director. The director shall not grant such approval except upon showing extraordinary circumstance requiring off-premises storage and not until the club demonstrates that it has exclusive control of this additional storage area. If approval is given by the director to store pool liquor at a location other than the licensed premises, such approved storage area shall not be a location where individuals may resort to for the consumption of food and/or alcoholic beverages and for entertainment. (Authorized by K.S.A , K.S.A Supp , ; effective May 1, 1978.) (Authorized by K.S.A Supp ; effective Jan. 1, 1966; amended Jan. 1, 1969; amended Jan. 1, 1970; amended Jan. 1, 1973; amended, E-77-15, March 19, 1976; amended Feb. 15, 1977; revoked, E-80-28, Dec. 12, 1979; revoked May 1, 1980.) and (Authorized by K.S.A Supp ; effective Jan. 1, 1966; revoked, E-80-28, Dec. 12, 1979; revoked May 1, 1980.) Rev Kansas Administrative Regulations Article 19 Class A Clubs Page 3

4 (Authorized by K.S.A Supp ; effective Jan. 1, 1966; amended, E-77-15, March 19, 1976; amended Feb. 15, 1977; revoked, T-88-22, July 1, 1987; revoked May 1, 1988.) (Authorized by K.S.A Supp , ; effective Jan. 1, 1966; amended, E78-9, Feb. 17, 1977; modified, L. 1978, Ch. 452, May 1, 1978; amended, E-79-31, Nov. 21, 1978; amended May 1, 1979; revoked, T-88-22, July 1, 1987; revoked May 1, 1988.) (Authorized by K.S.A , ; effective Jan. 1, 1966; amended Jan. 1, 1969; amended, E , Dec. 12, 1979; amended May 1, 1980; revoked May 1, 1982.) (Authorized by K.S.A Supp , ; effective, E-78-9, Feb. 17, 1977; effective May 1, 1978; amended, E-79-31, Nov. 21, 1978; amended May 1, 1979; revoked, T-88-22, July 1, 1987; revoked May 1, 1988.) (Authorized by K.S.A Supp , ; effective, E-78-9, Feb. 17, 1977; effectve May 1, 1978; amended, E-79-31, Nov. 21, 1978; amended May 1, 1979; revoked, T-88-22, July 1, 1987; revoked May 1, 1988.) (Authorized by K.S.A Supp , ; effective, E-78-9, Feb. 17, 1977; effective May 1, 1978; amended, E-79-31, Nov. 21, 1978; amended May 1, 1979; revoked, T-88-22, July 1, 1987; revoked May 1, 1988.) Definitions. As used in this article of these regulations, unless the context clearly requires otherwise, the following words and phrases shall have the meanings ascribed to them in this regulation: (a) ``Alcoholic liquor'' means alcohol, spirits, wine, beer and every liquid or solid, patented or not, containing alcohol, spirits, wine or beer and capable of being consumed as a beverage by a human being. Alcoholic liquor shall not include any cereal malt beverage. (b) ``Beer'' means a beverage containing more than 3.2% alcohol by weight, obtained by alcoholic fermentation of an infusion or concoction of barley or other grain, malt and hops in water. The term beer includes beer, ale, stout, lager beer, porter and similar beverages having such an alcoholic content. (c) ``Beneficial interest'' means any ownership interest by a person or that person's spouse in a business, corporation, partnership, business trust, association or other form of business organization which exceeds 5% of the outstanding shares of that corporation or a similar holding in any other form of business organization. (d) ``Bulk wine'' means wine that is sold to a club, either by a retailer or a distributor, in barrels, casks or bulk containers which individually exceed 20 liters. Rev Kansas Administrative Regulations Article 19 Class A Clubs Page 4

5 (e) ``Cereal malt beverage'' means any fermented but undistilled liquor brewed or made from malt or from a mixture of malt or malt substitute, but does not include any liquor which is more than 3.2% alcohol by weight. (f) ``Director'' means the director of the division of alcoholic beverage control of the department of revenue. (g) ``Distributor'' means those persons licensed by the director, pursuant to K.S.A Supp , a, and , to sell or offer for sale alcoholic liquor, spirits, wine, beer or cereal malt beverage to any person authorized by law to sell alcoholic liquor, spirits, wine, beer or cereal malt beverage at retail. (h) ``Guest of member'' means an individual who is known to and personally accompanied by a member of a club while on the licensed premises of the club. ``Guest of member'' shall not include members of the general public admitted to licensed club premises as guests of the club's owner, manager or employee. (i) ``Licensed premises'' means those areas described in an application for a club license that are under the control of the applicant and that are intended as the area in which alcoholic liquor or cereal malt beverages are to be served pursuant to the applicant's license. (j) ``Manager'' means the manager or assistant manager, or both, of any licensed club who is in charge of the daily operations of the licensed club. A manager shall be deemed to be employed in connection with the dispensing, selling, mixing or serving of alcoholic liquor. (k) ``Member'' means an individual who is a corporate stockholder, partner, trust beneficiary or associate and members of the individual's family as provided in the class A club's organizing documents. (l) ``Morals charge'' means a charge made in an indictment, information or a complaint alleging crimes which involve: (1) prostitution; (2) procuring any person; (3) solicitation of a child under 18 years of age for any immoral act involving sex; (4) possession or sale of narcotics, marijuana, amphetamines or barbiturates; (5) rape; (6) incest; (7) gambling; (8) adultery; or (9) bigamy. (m) ``Nonprofit fraternal club'' means a nonprofit corporation, partnership, business trust or association that: (1) is a fraternal beneficiary society, order or association operating under the lodge system which provides for the payment of life, sickness, accident or other benefits to its members or their dependents; or (2) is organized for the exclusive benefit of the members of a fraternity operating under the lodge system. (n) ``Nonprofit social club' means a nonprofit corporation, partnership, business trust or association that: (1) is organized and operated exclusively for the pleasure, recreation and other nonprofitable use of its shareholders, partners, beneficiaries or members; and Rev Kansas Administrative Regulations Article 19 Class A Clubs Page 5

6 (2) shall not distribute any of its net earnings to any shareholder, partner, beneficiary or member. (o) ``Nonprofit war veterans club'' means a nonprofit corporation, partnership, business trust or association that: (1) is a post or organization of war veterans, an auxiliary unit or society of a post or organization of war veterans or a trust or foundation for a post or organization of war veterans; (2) requires that 75% of its shareholders, partners, beneficiaries or members be war veterans and substantially all its other members are veterans, widows of veterans or widowers of veterans; and (3) shall not distribute any of its net earnings to any shareholder, partner, beneficiary or member. (p) ``Person'' means any natural person, corporation, association, trust or partnership. (q) ``Retailer'' means a person licensed by the director to sell at retail, or offer for sale at retail, alcoholic liquor for consumption off the licensed premises of the retailer. (r) ``Spirits'' means any beverage that contains alcohol obtained by distillation, mixed with water or other substances in solution. The term ``spirits'' includes brandy, rum, whiskey, gin or other spirituous liquors, and liquors when rectified, blended or otherwise mixed with alcohol or other substances. (s) ``Wine'' means any alcoholic beverage obtained by the normal alcoholic fermentation of the juice of sound, ripe grapes, fruits, berries or other agricultural products, including beverages containing added alcohol or spirits or containing sugar added for the purpose of correcting natural deficiencies. (Authorized by K.S.A Supp ; implementing K.S.A Supp , K.S.A Supp ; effective, T-88-22, July 1, 1987; effective May 1, 1988; amended Aug. 6, 1990; amended, T , Nov. 9, 1992; amended Dec. 21, 1992.) Applications and renewals; documents required. Each application for a class A club license shall be made upon forms prepared by the director and shall contain all information the director deems necessary. Any application which does not contain the required information may be returned to the applicant without the application being considered on its merits. (a) General requirements. Each application for a class A club license shall be accompanied by the following documents and all other documents the director deems necessary: (1) A copy of a written lease, with at least nine months remaining in its term from the date the license is issued, or proof of ownership by the applicant of the premises sought to be licensed; (2) a copy of any management or catering contract in force or a proposed management or catering contract, if applicable; (3) a description of the club premises. The description may include those areas outside the main service area that are in close proximity to the main service area and are located upon property subject to legal occupation by the applicant, as approved by the director. The description shall state the location of the licensed premises, the approximate dimensions of the licensed premises, enough detail to identify the licensed premises and a depiction of the liquor storage area; (4) a certified statement from the applicant that the licensed premises are located: (A) in an area where the zoning regulations of either the city, township or county allow the operation of a club; or Rev Kansas Administrative Regulations Article 19 Class A Clubs Page 6

7 (B) in an area where no zoning regulations have been adopted; (5) the registration fee in the form of a certified check, cashier's check, money order or cash. Personal or business checks shall not be accepted; (6) the license fee in the form of a certified check, cashier's check, money order or cash. Personal or business checks shall not be accepted; (7) a disclosure statement listing each owner, officer, manager, trustee, director, stockholder owning in the aggregate more than 5% of the common or preferred stock, grantor or beneficiary, and the spouses of each of these individuals. The disclosure statement shall certify that all the individuals listed are not disqualified from obtaining a club license as provided in K.A.R ; and (8) a disclosure statement listing all personnel who will be mixing or dispensing alcoholic liquor. (b) Corporations. In addition to the documents required by subsection (a), each application on behalf of a corporation shall include: (1) a certified copy of the articles of incorporation as a Kansas domestic not-for-profit corporation; (2) a copy of the corporate bylaws; and (3) an appointment of process agent together with a power of attorney authorizing that agent to conduct the business of the club and receive all service of process on behalf of the club. The process agent shall be an individual. (c) Business trusts or associations. In addition to the documents required by subsection (a), each application on behalf of an unincorporated business trust or association shall include a copy of the constitution, articles of association, declaration of trust, or other documents setting forth the aims and purposes of the business trust or association, setting forth the membership requirements and declaring the county in which the business trust or association is to be located. (d) Partnerships. In addition to the documents required by subsection (a), each application on behalf of a partnership shall include a copy of the partnership agreement. (Authorized by K.S.A Supp ; implementing K.S.A Supp ; ; ; ; , as amended by 1992 HB 2719; ; ; ; effective, T88-22, July 1, 1987; effective May 1, 1988; amended, T , Nov. 9, 1992; amended Dec. 21, 1992.) Requirements for class A club license. (a) Corporations. A corporation shall not be issued a class A club license if any officer, manager, director, stockholder owning a beneficial interest in the corporation or spouse of these individuals: (1) Has been convicted of a felony under the laws of this state, any other state or the United States; (2) has been convicted of being the keeper or is keeping a house of prostitution or has forfeited bond to appear in court to answer charges of being a keeper of a house of prostitution; (3) has been convicted of being a proprietor of a gambling house, pandering or any other crime opposed to decency and morality or has forfeited bond to appear in court to answer charges for any of those crimes; (4) is not at least 21 years of age. This shall not apply to the spouse of the individual; (5) (A) Appoints or supervises any law enforcement officer, other than as a member of the governing body of a city or county; (B) is a law enforcement official; or (C) is an employee of the director. Paragraph (5), above, shall not apply to an officer of a post home, a congressionally chartered service or fraternal organization or a benevolent association or society thereof; (6) intends to act as the agent of another in exercising control of the license; Rev Kansas Administrative Regulations Article 19 Class A Clubs Page 7

8 (7) at the time of application for renewal of the license issued by the director would be ineligible for the license upon a first application. This shall not apply if the officer's, director's, manager's or stockholder's spouse is ineligible upon the application for renewal; (8) has had any license or permit issued by the director revoked; (9) has a beneficial interest in the manufacture, preparation or wholesale or retail sale of alcoholic liquors or a beneficial interest in any other club or drinking establishment licensed by the director. Any officer, manager, director, stockholder or spouse of these individuals may own a beneficial interest in a distributor or retailer if the club purchases no alcoholic liquor from that distributor or retailer; and (10) has been an officer, manager or director or a stockholder owning a beneficial interest in a corporation which: (A) Has had a license revoked under the provisions of the club and drinking establishment act; or (B) has been convicted of a violation of the club and drinking establishment act or the cereal malt beverage laws of this state. (b) Business trusts or associations. A business trust or association shall not be issued a class A club license if any officer, director, manager, owner who owns a beneficial interest in the business trust or association or a spouse of any of these individuals: (1) Has been convicted of a felony under the laws of this state, any other state or the United States; (2) has been convicted of being the keeper or is keeping a house of prostitution or has forfeited bond to appear in court to answer charges of being a keeper of a house of prostitution; (3) has been convicted of being a proprietor of a gambling house, pandering or any other crime opposed to decency and morality or has forfeited bond to appear in court to answer charges for any of those crimes; (4) is not at least 21 years of age. This shall not apply to the spouse of the individual; (5) (A) Appoints or supervises any law enforcement officer, other than as a member of the governing body of a city or county; (B) is a law enforcement official; or (C) is an employee of the director; Paragraph (5), above, shall not apply to an officer of a post home, a congressionally chartered service or fraternal organization or a benevolent association or society thereof; (6) intends to act as the agent of another in exercising control of the license; (7) at the time of application for renewal of the license issued by the director would be ineligible for the license upon a first application. This shall not apply if the officer's, director's, manager's or owner's spouse is ineligible upon the application for renewal; (8) has had any license or permit issued by the director revoked; (9) has a beneficial interest in the manufacture, preparation or wholesale or retail sale of alcoholic liquors or a beneficial interest in any other club or drinking establishment licensed by the director. Any officer, director, manager, owner or spouse of the same may own a beneficial interest in a distributor or retailer if the club licensed by the director purchases no alcoholic liquor from the distributor or retailer; and (10) has been an officer, manager, director or stockholder owning a beneficial interest of a corporation which: Rev Kansas Administrative Regulations Article 19 Class A Clubs Page 8

9 (A) Has has a license revoked under the provisions of the club and drinking establishment act; or (B) has been convicted of a violation of the club and drinking establishment act or the cereal malt beverage laws of this state. (C) Partnerships. A partnership shall not be issued a class A club license if any manager, partner or spouse of a manager or partner: (1) Has been convicted of a felony under the laws of this state, any other state or the United States; (2) has been convicted of being the keeper or is keeping a house of prostitution or has forfeited bond to appear in court to answer charges of being a keeper of a house of prostitution; (3) has been convicted of being a proprietor of a gambling house, pandering or any other crime opposed to decency and morality or has forfeited bond to appear in court to answer charges for any of those crimes; (4) is not at least 21 years of age. This shall not apply to the spouse of the partner or manager; (5) (A) Appoints or supervises any law enforcement officer, other than as a member of the governing body of a city or county; (B) is a law enforcement official; or (C) is an employee of the director; Paragraph (5), above, shall not apply to an officer of a post home, congressionally chartered service or fraternal organization or a benevolent association or society thereof; (6) intends to act as the agent of another in exercising control of the license; (7) at the time of application for renewal of the license issued by the director would be ineligible for the license upon a first application. This shall not apply if the manager's or partner's spouse is ineligible upon the application for renewal; (8) has had any license or permit issued by the director revoked; (9) has a beneficial interest in the manufacture, preparation or wholesale or retail sale of alcoholic liquors or a beneficial interest in any other club or drinking establishment licensed by the director. A manager, partner or spouse of the same may own a beneficial interest in a distributor or retailer if the club licensed by the director purchases no alcoholic liquor from that distributor or retailer; (10) has been an officer, manager, director or stockholder owning a beneficial interest of a corporation which: (A) Has had a license revoked under the provisions of the club and drinking establishment act; or (B) has been convicted of a violation of the club and drinking establishment act or the cereal malt beverage laws of this state; (11) has been a citizen of the United States for less than 10 years. This shall not apply to the spouse of the manager or partner; (12) has been a resident of the state of Kansas for less than one year immediately preceding the date of application. This shall not apply to the spouse of the manager or partner; and (13) is not a resident of the county in which the club is to be located. This shall not apply to the spouse of the manager or partner. Rev Kansas Administrative Regulations Article 19 Class A Clubs Page 9

10 (d) Every corporate applicant shall be a Kansas domestic not-for-profit corporation. (e) For the purpose of determining qualifications under subsections (a), (b) and (c) of this regulation, any person who leases premises to a class A club upon terms which result in the lessor having a beneficial interest in the club's business, shall be deemed to be a partner in the club's business. A lessor shall be deemed to have a beneficial interest in a club's business, if the lessor receives as rent, in whole or in part, a percentage of the club's gross receipts or profits from the sale of alcoholic liquor, other items to be mixed with alcoholic liquor, or club membership fees. Percentage rent provisions that exclude these items shall be subject to review and approval by the director. (Authorized by K.S.A as amended by L. 1987, Ch. 182, Sec. 85; implementing K.S.A as amended by L. 1987, Ch. 182, Sec. 75; effective, T-88-22, July 1, 1987; effective May 1, 1988.) Issuance of license. (a) An annual class A club license shall be issued to each applicant determined by the director to have satisfied the requirements of the club and drinking establishment act and this article of these regulations. (b) An application for a license may be rejected by the director if: (1) the applicant's officers, directors, partners, registered agent, managers or owners have previously owned or operated under any type of retail liquor, club, drinking establishment or caterer's license, and at the time the previous license was surrendered, the licensee had been ordered to appear and show cause why the license should not be revoked or suspended; (2) the application is for premises which were the subject of the order to appear and show cause as set forth in paragraph (1), above, and it appears that the new application for a license is an attempt to avoid any possible remedial action taken by the director against the former licensee; (3) the applicant's officers, directors, partners, registered agent, managers or owners, are currently delinquent in payment of any excise or enforcement tax, fees or fines to the State of Kansas; or (4) the applicant's officers, directors, partners, registered agent, managers or owners have previously owned or operated any retail liquor, club, drinking establishment or caterer's license, and at the time the previous license was surrendered, the licensee was delinquent in payment of any excise or enforcement tax, fees or fines to the State of Kansas; or (5) the application is for premises which were the subject of the delinquent taxes as set forth in paragraph (3), above, and it appears that the new application for a license is an attempt to avoid payment of the tax. (Authorized by K.S.A Supp ; 79-41a03; implementing K.S.A Supp and 79-41a03; effective, T-88-22, July 1, 1987; effective May 1, 1988; amended Aug. 6, 1990.) Licenses, loss or destruction of; application for and issuance of duplicate. Whenever any license issued by the director is lost or destroyed before its expiration, the club to which the license was issued may make written application to the director for a duplicate license. The application shall set forth all the facts and circumstances concerning the loss or destruction of the license and shall be sworn to by each person applying for the duplicate. Upon review of the application, a duplicate license may be issued by the director. (Authorized by and implementing K.S.A as amended by L. 1987, Ch. 182, Sec. 85; effective, T-88-22, July 1, 1987; effective May 1, 1988.) Rev Kansas Administrative Regulations Article 19 Class A Clubs Page 10

11 Change of club status. A class A club license shall not be converted to either a class B club or a drinking establishment license. (Authorized by K.S.A as amended by L. 1987, Ch. 182, Sec. 85; implementing K.S.A as amended by L. 1987, Ch. 182, Sec. 86; effective, T-88-22, July 1, 1987; effective May 1, 1988.) Refund upon voluntary cancellation. If the license of any club is canceled, except through revocation or suspension, the club shall be eligible for a refund of a portion of the annual license fee. The refund shall be equal to one-twelfth of the annual license fee for each full calendar month of the license year which remains at the time of the cancellation. The refund shall only be made upon application to the director. (Authorized by K.S.A ; implementing K.S.A as amended by L. 1987, Ch. 182, Sec. 80; as amended by L. 1987, Ch. 182, Sec. 86; effective, T-88-22, July 1, 1987; effective May 1, 1988.) Guests of members; reciprocal members; registration. (a) A club shall only admit members, guests of members, reciprocal members or guests of reciprocal members. Admission of any other individual to the licensed premises is prohibited. (b) ``Reciprocal member'' means an individual who belongs to a club which has executed a written reciprocal agreement with the club to which access is sought, as provided by K.A.R , and has filed the agreement with the director. (c) Each club that has entered into reciprocal agreements shall keep on the licensed premises a reciprocal guest book in which each reciprocal member shall legibly sign his or her name each time the member enters the club. Each reciprocal member shall show the member's personal address and the name and city address of the club of original membership. (d) The privileges extended to reciprocal members shall be determined by the written reciprocal agreement. Each guest or reciprocal member shall be entitled to all the privileges of the club as may be provided in the reciprocal agreement. The extension of club privileges to a guest shall end with the departure of the sponsoring club member from the licensed premises. (Authorized by K.S.A as amended by L. 1987, Ch. 182, Sec. 85; implementing K.S.A as amended by L. 1987, Ch. 182, Sec. 86; effective, T-88-22, July 1, 1987; effective May 1, 1988.) Roster of stockholders, partners, beneficiaries or associates. Each club shall maintain upon the licensed premises, a current roster of stockholders, partners, beneficiaries or associates who are entitled to access and use of the licensed premises and to services offered by the licensee club. (Authorized by K.S.A as amended by L. 1987, Ch. 182, Sec. 85; implementing K.S.A as amended by L. 1987, Ch. 182, Sec. 65, as amended by L. 1987, Ch. 182, Sec. 86; effective, T-88-22, July 1, 1987; effective May 1, 1988.) Agreement for reciprocal membership. (a) Any two or more class A clubs may enter into an agreement which allows members of each club to have access to all other clubs which are parties to the reciprocal agreement. Rev Kansas Administrative Regulations Article 19 Class A Clubs Page 11

12 (b) Each club shall submit two copies of a proposed reciprocal agreement to the director for approval. The agreement shall be properly executed and comply with the club and drinking establishment act. The club shall keep an approved copy of the agreement upon the licensed premises at all times. (c) Upon severance of any reciprocal agreement each club shall return the approved copy of the agreement to the director with a notification that the agreement has been canceled. (d) The provisions of this regulation shall not apply to a nationally chartered war veterans club which allows admission of its members to the various posts located within the state. (Authorized by K.S.A as amended by L. 1987, Ch. 182, Sec. 85; implementing K.S.A as amended by L. 1987, Ch. 182, Sec. 86; effective, T-88-22, July 1, 1987; effective May 1, 1988.) Employees; registration of same; prohibitions. (a) Each club shall register with the director all employees who will mix, sell, serve or dispense alcoholic liquor. The registration shall be submitted on forms supplied by the director, within five days after the employee begins work for the club and upon each renewal of the club's license. (b) A club shall not employ or continue to employ any person: (1) who is under the age of 18 years to serve alcoholic liquor or cereal malt beverage; (2) who is under the age of 21 to mix or dispense drinks containing alcoholic liquor or cereal malt beverage; (3) who is under the age of 21 years and is not supervised by the licensee or an employee who is at least 21 years of age; (4) who has been convicted of a felony or of any crime involving a morals charge in Kansas, any other state or the United States, to dispense, mix or serve alcoholic liquor or cereal malt beverage; or (5) who has been convicted within the previous two years of a violation of any intoxicating liquor law of Kansas, any other state or the United States, to dispense, mix or serve alcoholic liquor or cereal malt beverage; or (6) who is a manufacturer, distributor or retailer, or who is an officer, agent, or employee of a manufacturer, distributor, or retailer, in the capacity of a person registered to mix, serve, sell, or dispense alcoholic liquor. This shall not apply to a distributor or a retailer who is an officer, director or board member of a class A club if the distributor or retailer sells no alcoholic liquor to the class A club. (Authorized by K.S.A Supp ; implementing K.S.A Supp ; effective, T-88-22, July 1, 1987; effective May 1, 1988; amended July 1, 1991.) Purchase of alcoholic liquor and cereal malt beverages; requirements and restrictions. (a) Each club shall purchase alcoholic liquor only from a retailer. However, any club may purchase bulk wine, beer and cereal malt beverages from a distributor. (b) Any club may receive delivery of alcoholic liquor to its licensed premises from a retailer and delivery of bulk wine, beer and cereal malt beverages from a distributor. (c) A club shall not purchase alcoholic liquor or beer from any retailer who does not possess a federal wholesaler's basic permit and who does not have on display at the retail establishment a sign that states that the licensee is a ``Wholesale Liquor Dealer Under Federal Law.'' A club shall not warehouse any liquor on any retail liquor store premises. (d) A club shall not purchase bulk wine, beer or cereal malt beverage from any distributor who does not possess a federal wholesaler's basic permit and who does not have on display at the wholesale establishment a sign that states that the licensee is a ``Wholesale Liquor Dealer Under Federal Law.'' A club shall not warehouse its liquor on any distributor's premises. Rev Kansas Administrative Regulations Article 19 Class A Clubs Page 12

13 (e) Each club, when making alcoholic liquor purchases from retailers or distributors, shall obtain and keep, for a period of not less than three years from the date of purchase, a sales slip that contains the following information: (1) The date of purchase; (2) the name and address of the retailer or distributor; (3) the name and address of the club as it appears on the club license; (4) the brand, size, and amount of all alcoholic liquor purchased; and (5) the subtotal of the cost of the alcoholic liquor and the total cost of the order including enforcement tax and delivery charge, if any. (f) Each club shall purchase alcoholic liquor through a registered employee of the licensed club who shall be at least 21 years of age. The club shall provide to the registered employee identification sufficient to demonstrate to the retailer or distributor who possesses the federal wholesale basic permit that the individual making the purchase is so registered. (g) Each club shall maintain on the licensed premises all records of all alcoholic liquor purchased. These records shall be available for inspection by the director or any agent or employee of the director or secretary upon request. (Authorized by K.S.A as amended by L. 1987, Ch. 182, Sec. 10; ; as amended by L. 1987, Ch. 182, Sec 85; 79-41a03 as amended by L. 1987, Ch. 182, Sec. 119; implementing K.S.A ; as amended by L. 1987, Ch. 182, Sec. 14; as amended by L. 1987, Ch. 182, Sec. 17; as amended by L. 1987, ch. 182, Sec. 18; as amended by L. 1987, Ch. 182, Sec. 73; 79-41a03 as amended by L. 1987, Ch. 182, Sec. 119; effective, T-88-22, July 1, 1987; effective May 1, 1988.) Licensee's responsibility for conduct of business and employees. Each licensee shall be responsible for the conduct of its business. Each licensee shall be held responsible for all violations of the club and drinking establishment act by the following people while on the licensed premises: (a) An employee of the club; (b) an employee of any person contracting with the club to provide services or food; and (c) any individual mixing, serving, selling or dispensing alcoholic liquor. (Authorized by and implementing K.S.A as amended by L. 1987, Ch. 182, Sec. 85; effective, T-88-22, July 1, 1987; effective May 1, 1988.) Storage of liquor; removal from club premises. (a) Each licensee shall store its liquor only on the licensed premises of the club unless the licensee has received prior approval in writing from the director to do otherwise. (b) Any licensee may store wine purchased by a customer only in the unopened original container on the licensed premises, pursuant to K.S.A and amendments thereto. The licensee shall be responsible for the contents of each customer s wine storage area. (c) The wine storage area shall be subject to immediate entry and inspection by any law enforcement officer or any officer or agent of the director. Each licensee shall maintain, on the licensed premises, a key or other means to access the contents of the wine storage area. (d)(1) The licensee may allow a customer to have access to the customer s wine storage area. An agent or employee of the licensee shall accompany each customer to the customer s wine storage area. (2) A receipt showing the quantity of each brand of wine purchased shall be maintained in each customer s wine storage area. Each time the customer requests the removal of any wine from the storage Rev Kansas Administrative Regulations Article 19 Class A Clubs Page 13

14 area, the licensee or its owner, employee, or agent shall mark the receipt showing the date of removal and the quantity of each brand removed. (e) No licensee, and no owner, employee, or agent of the licensee, shall make any sales of alcoholic liquor for consumption off the licensed premises. No alcoholic liquor purchased on the club premises shall be removed from the club premises, except in accordance with this regulation. (f)(1) A licensee may permit its customers to remove partially consumed bottles of wine from the licensed premises, in accordance with K.S.A and amendments thereto. (2) If any customer wishes to remove from the licensed premises a partially consumed bottle of wine that had been stored in its original unopened container pursuant to K.S.A and amendments thereto and this regulation, the licensee or its employee shall provide the customer with a copy of the original receipt with a notation that the bottle was removed from the customer s wine storage area on that date. (Authorized by K.S.A ; implementing K.S.A , K.S.A Supp , and K.S.A Supp ; effective, T-88-22, July 1, 1987; effective May 1, 1988; amended Sept. 17, 2010.) Nontaxed liquor and refilling of containers prohibited. (a) Alcoholic liquors shall only be dispensed from or stored in original containers bearing Kansas alcoholic liquor identification stamps. A licensed club shall not refill any such original container with any alcoholic liquor, or any other substance. (b) A member, guest or reciprocal member may bring bottles onto the club premises upon the following conditions: (1) A club shall not warehouse any bottles upon the club premises; (2) each person bringing any bottles onto the club premises shall remove the bottles when departing from the club premises; and (3) each bottle shall bear a Kansas alcoholic liquor identification stamp if required by law. (Authorized by K.S.A as amended by L. 1987, Ch. 182, Sec. 10; as amended by L. 1987, Ch. 182, Sec. 73; as amended by L. 1987, Ch. 182, Sec. 85; implementing K.S.A as amended by L. 1987, Ch. 182, Sec. 53; L. 1987, Ch. 182, Sec. 93; effective, T-88-22, July 1, 1987; effective May 1, 1988.) Cereal malt beverages; sale allowed. (a) Any club may sell cereal malt beverages upon the licensed premises if: (1) The club notifies the director when it obtains a license for the retail sale of cereal malt beverages; (2) the club notifies the director of each renewal of the license for the retail sale of cereal malt beverages; and (3) the club dispenses cereal malt beverage only for consumption upon the licensed premises. (b) Violation of any cereal malt beverage statute shall subject the club to suspension or revocation of its license or to a monetary fine under the procedures referenced of K.A.R et seq. (Authorized by K.S.A as amended by L. 1987, Ch. 182, Sec. 85; implementing K.S.A as amended by L. 1987, Ch. 182, Sec. 100; effective, T-88-22, July 1, 1987; effective May 1, 1988.) Minimum prices for drinks; how determined. (a) A licensed club shall not sell any drink to any person for less than the acquisition cost of that drink to the club. (b) The cost of each of the following items shall be included in the acquisition cost of a drink: Rev Kansas Administrative Regulations Article 19 Class A Clubs Page 14

15 (1) All alcoholic liquor contained in the drink; and (2) any liquid of a non-alcoholic nature contained in the drink. (c) Any of the following items shall not be required to be included in the acquisition cost: (1) City service or tap water; (2) ice; (3) employee salaries or other usual overhead; and (4) any other items of clearly negligible value used in the drink. (d) In determining the minimum price, a club shall not include the drink tax as imposed by K.S.A a02. This tax shall be collected in addition to the minimum price for the drink itself. (Authorized by K.S.A as amended by L. 1987, Ch. 182, Sec. 85; implementing K.S.A as amended by L. 1987, Ch. 182, Sec. 94; effective, T-88-22, July 1, 1987; effective May 1, 1988.) Clubs charge the same price for the same drink all day; day defined. (a) A class A club shall not sell a drink to any person for less than the price charged for that same drink to all other club patrons on that day. Any particular drink that is offered for sale at any time during the day shall be offered at the same price for the entire day. (b) The term ``day'' shall mean from 9:00 a.m. until 2:00 a.m. the following calendar day. (Authorized by K.S.A as amended by L. 1987, Ch. 182, Sec. 85; implementing K.S.A as amended by L. 1987, Ch. 182, Sec. 94; effective, T-88-22, July 1, 1987; effective May 1, 1988.) Licensee must pay city or county license tax before making sales. A licensee shall not operate until the licensee has paid the annual occupation or license tax imposed by the city or county in which the licensed premises are located. A licensee shall not sell 3.2 beer without first having obtained a cereal malt beverage license. (Authorized by K.S.A as amended by L. 1987, Ch. 182, Sec. 85; implementing K.S.A as amended by L. 1987, Ch. 182, Sec. 74; effective, T-88-22, July 1, 1987; effective May 1, 1988.) Federal retail stamp. Each club licensee shall purchase from the United States bureau of alcohol, tobacco and firearms a federal retail stamp and shall display that stamp, or proof of payment for the stamp, in public view on the licensed premises. (Authorized by K.S.A as amended by L. 1987, Ch. 182, Sec 85; implementing K.S.A as amended by L. 1987, Ch. 182, Sec. 66; effective, T-88-22, July 1, 1987; effective May 1, 1988.) Excise tax shall be current. Each club that fails to register for an excise tax registration number with the director of taxation shall be subject to cancellation of its license or fine by the director. Each club that is delinquent in the payment of its excise taxes levied on alcoholic liquors shall be subject to cancellation of its license or fine by the director. (Authorized by and implementing 79-41a03 as amended by L. 1987, Ch. 182, Sec. 119; effective, T , July 1, 1987; effective May 1, 1988.) Rev Kansas Administrative Regulations Article 19 Class A Clubs Page 15

16 Suspension and revocation; grounds for; procedure. The license of any class A club may be revoked, canceled or suspended by the director for any one or more of the following reasons, subject to the procedures and other provisions of K.A.R et seq.: (a) The licensee has omitted or misstated a material fact in its application; (b) the licensee has operated in a manner materially different from that represented in the application; (c) the licensee no longer meets the criteria for a nonprofit social, fraternal or war veterans club; (d) the licensee has engaged in a prohibited transaction; (e) the licensee has violated any provision of the liquor control act, the club and drinking establishment act, the cereal malt beverage act or any regulations adopted pursuant thereto; (f) there has been a violation of the laws of Kansas pertaining to the sale of alcoholic liquor or cereal malt beverage or a violation of the laws of the United States pertaining to the sale of intoxicating liquor or a violation involving a morals charge; (g) the licensee, its managing officers or any employee, has purchased and displayed, on the licensed premises a federal wagering occupational stamp or a federal coin operated gambling device stamp issued by the United States treasury department; (h) the licensee has refused to permit the director or any agent or employee of the director or the secretary to inspect the licensed premises and any alcoholic liquor in the licensee's possession or under the licensee's control upon the premises covered by the license, or upon any other premises where the liquor may be stored; or (i) the licensee has allowed a person who is under the age of 21 years to possess alcoholic liquor while on the licensed premises. (Authorized by K.S.A as amended by L. 1987, Ch. 182, Sec. 85; implementing K.S.A as amended by L. 1987, Ch. 182; Sec. 66; as amended by L. 1987, Ch. 182, Sec. 68; effective, T-88-22, July 1, 1987; effective May 1, 1988.) Public functions upon licensed premises; when allowed; approval of director. (a) A club shall not open any part of its licensed premises to the public unless it has first received the written approval of the director. All requests for written approval of the director to open the licensed premises to the public shall be accompanied by a sworn statement containing: (1) The days of the week and hours of those days for which the application is made; (2) a description of the exact area of the club to be open to the general public; (3) the statement that no alcoholic liquor or cereal malt beverage will be sold, dispensed or consumed by anyone in the area described during the time indicated; (4) the date and time that normal club activities will be resumed in the described areas; and (5) a description of the type of activity to be conducted and by whom. (b) Written approval shall not be required for a class A club holding a bona fide bingo license to operate bingo games which are open to the public, pursuant to K.S.A and amendments thereto. Application for and acceptance of a bingo license by a class A club shall be considered as consent by the class A club licensee to comply with the public functions requirements of this regulation. (c) The use of the licensed premises by the general public shall not remove the area from the jurisdiction of the director. The licensee may be suspended, revoked or fined for any violations of chapter 41 of the Kansas statutes during any public function held on its licensed premises. (Authorized by and implementing K.S.A as amended by L. 1987, Ch. 182, Sec. 85; effective, T-88-22, July 1, 1987; effective May 1, 1988; amended July 1, 1991.) Rev Kansas Administrative Regulations Article 19 Class A Clubs Page 16

17 Display of license. Each class A club shall display its license in a conspicuous place on the licensed premises. (Authorized by K.S.A as amended by L. 1987, Ch. 182, Sec. 85, implementing K.S.A as amended by L. 1987, Ch. 182, Sec. 67; effective, T-88-22, July 1, 1987; effective May 1, 1988.) Denial, revocation, or suspension of license upon request for hearing by governing body of city or county; request; evidence. (a) The governing body of a city or county may request a hearing before the director to determine whether an application for licensure or renewal shall be denied or whether a license issued under the club and drinking establishment act shall be revoked or suspended. (b) The request shall be submitted in writing by the governing body, on city or county letterhead, to the director and shall be accompanied by evidence that indicates reasonable cause exists to conduct a hearing to deny, revoke, or suspend the license. (c) The director shall review the evidence presented and determine whether reasonable cause exists to conduct a hearing to deny, revoke, or suspend the license. The director shall notify the governing body of the date and time of the hearing, or denial of the request, in writing as soon as reasonably possible. (d) The hearing and notices shall be in accordance with the Kansas administrative procedures act (KAPA). The director shall consider the evidence presented by the governing body and the licensee at the hearing and determine whether the license shall be denied, revoked, or suspended. (e) Evidence to be considered in determining whether a license shall be denied, revoked, or suspended shall include the following: (1) A crime of violence has occurred in, on, or about the premises, arising from conduct occurring within the licensed premises. (2) The licensed premises and surrounding areas under relative control of the licensee constitute an abnormal and unreasonable drain on public resources to secure the safety of patrons, local residents, and businesses. (3) The licensed premises, including surrounding areas under relative control of the licensee, constitute a threat to public health, safety, and welfare. (4) The governing body has filed one or more nuisance actions against the licensee or the licensed premises. (5) The governing body or licensee has taken all reasonable remedial steps regarding the situation. (f) For purposes of this regulation, crime of violence shall include arson, murder, manslaughter, rape or sexual assault, armed robbery, assault, and battery, and an attempt to commit any of these crimes. (Authorized by and implementing K.S.A Supp ; effective Sept. 17, 2010.) Extension of premises. (a) A licensee may permanently or temporarily extend its licensed premises upon written approval by the director. (b) A licensee shall request the director s approval to extend its licensed premises in writing at least 10 days before the proposed extension. (c) Each request shall be accompanied by a diagram of the extended premises, clearly showing the boundaries of the premises, entrances to and exits from the premises, and the area in which the service of alcoholic liquor would take place. (d) For a temporary extension, the request shall include the dates on which and times during which the premises would be extended. If the licensee does not own or lease the area to be included in the Rev Kansas Administrative Regulations Article 19 Class A Clubs Page 17